2020 lessons – plan for normal, or plan for better?

Carlos Thibaut is a consultant and board member of the Society of Mortgage Professionals


2020, a year no one will ever forget. The greatest global crisis since WW2. Huge impacts on health systems, government, the economy, global travel. So how did we respond in the UK mortgage market?

Incredibly well, is the truth. Intermediaries reacted quickly to the new rules of lockdown, using technology to maintain contact with customers and continuing to process business remotely. Lenders adapted with impressive speed and largely maintained services, in most cases adapting processes to the new world of lockdown and remote working. Agile thinking, furlough, technology, and the essential nature of financial advice shielded the sector from the extreme impacts seen in travel, hospitality, leisure and high street retail. As always in crises some sectors adapted quickly and some, such as online retail, prospered in the new world.

In the mortgage sector, stamp duty was cut to zero on properties under £500k as the country emerged from lockdown. Many businesses, beginning to think about their business models, proposition, costs, new digital processes, and remote working, shelved plans to cope with the huge increase in demand for mortgages. I have heard people talk of a ‘feeding frenzy’, record business months in August, September, and October. Lenders struggling to cope with volumes, brokers struggling to cope with frequent criteria changes and rapid product withdrawals. The new November lockdown appears to have had little effect on this surge of new business.

So, whilst it’s understandable that the focus of many is on processing the next case, we need to think about what 2020 has taught us, and how do we plan for the future.

What we know is that the next two years will remain unpredictable. Will the end of stamp duty discounts, furlough schemes ending, rising unemployment and Brexit create a perfect storm? One major consulting firm predicts house prices will rise 1% in 2021, another predicts a fall of -7%. One study suggested 20% of people are less likely to move than before the pandemic, and that the current boom is simply bringing forward demand and housing transactions will drop sharply after March 2021.

The truth is that no one knows – we are in uncharted territory. We can, however, learn from the past. Post Credit Crunch, I heard the surviving mortgage broking businesses saying they would never rely on a transactional single product model, and that a broader proposition was the way forward. A more resilient business model means diversifying income sources, retaining clients through their life changes, and acquiring clients through a broad professional advice proposition.

Consumers value professional advice, and it is that advice that is the real value product. Quality advice should be about helping clients reduce debt, build wealth for the future, and protect assets and income with protection and robust wills and trust planning.

As difficult as it may be in today’s busy market, principals and leadership teams need to put aside time to plan for a better business able to cope with the unpredictable times ahead.

In simple terms, I believe that a review of business plans should focus on 5 key areas:


Modify the business model

Re-deploy resources

Cash  liquidity and margins


Define the services you will be offering, it might be that you need to consider a referral arrangement with businesses that offer complimentary services, be they equity release, wealth or wills and trusts.

Consider how you will communicate your business to existing and new customers and agree a marketing plan and contact programme. Analyse the customer experience, most consumers expect digital tools and processes to streamline their interaction with businesses.

Modify your business model   

Having agreed your proposition, what technology will you need? Look at various suppliers and focus on reliable integrated platforms that allow you to automate processing, provide accurate MI, have efficient sales processes, accounts, customer centric portals and tools to collect data, referral management, marketing tools, analytics to better understand your customers and their needs. Speak to existing technology users and choose a supplier that is committed to keeping up with emerging trends, data collection, Id verification, direct submission to lenders and insurers. Take the opportunity to embed digital processes to take care of heavy lifting, data collection customer contact and engagement to ensure advisers spend as much time as possible advising.

Re-deploy resources

If you have reviewed your business model and chosen the right technology you may be able to upskill and re-deploy existing staff to carry out more customer facing duties, advisers to specialise in new products.

Cash liquidity and margins

Take the opportunity to understand your costs, do I need the office space I have, what margins do I make on my core services in total and on a £per hour basis? If the mortgage market falls, can I drive additional income through other services? Do I have accurate financial modelling and cash flow forecasting to respond to market changes?



Change is always difficult to manage, but with the new unpredictability facing all businesses, re-evaluating business plans and planning for change should be non-negotiables for any business.

‘Normal’ may never return, so let’s take the opportunity to plan for better.


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